Internet threat
January 13, 2010
A new study carried out by the research institute Emnid for the financial services firm KPMG has found that criminal methods are being used more and more often in the ruthless and competitive world of business.
The survey, which took in approximately 300 companies of all sizes, found that around one in three companies had been the victim of business crime. Two thirds of the companies surveyed also expected the level of criminality to rise.
The biggest economic crimes remain fraud, theft, embezzlement and breach of trust, but money-laundering and the forgery of accounts and financial information have all risen since the last survey was carried out in 2006.
Ignorance breeds carelessness
According to KPMG spokesman Frank M. Huelsberg, companies still need to be more aware of how crimes operate. "Despite these alarming results, small and medium-sized companies are particularly prone to underestimate the danger of falling victim to crime," he said.
Fifty-six percent of the employees surveyed said that their company was less likely to be a victim of economic crime than a major corporation, while 76 percent believe they have made adequate security arrangements.
"Privately- or family-owned companies like to put their trust in their employees. But that makes them vulnerable," Huelsberg said, "Experience shows that basic security mechanisms are often neglected in such companies."
Third-party threat
In 62 percent of economic crimes involving small and medium-sized companies, employees conspired with an external third party. This figure is only 40 percent with large companies.
The theft of business or operational secrets is a growing threat, according to the study. A third of small and medium-sized companies have been a victim of such theft, the study said.
"The sale of sensitive information to competitors or criminals is particularly strong in times of economic crisis," Huelsberg says, "Nowadays even the most complex construction plans fit on a USB stick. Data theft and industrial espionage can be child's play if security fails, and the loss of sensitive designs or formulas can be fatal for a small, innovation-based company."
Internet crime
The survey also uncovered a big leap in the use of the internet for economic crime. Just over half (53 percent) of such crime now occurs with the use of the internet, 30 percent more than in 2006. Internet-related economic crime includes identity theft, the fraudulent offer of goods and services, and credit card fraud.
"New criminal phenomena almost always use information technologies and the internet," said Huelsberg, "And they are replacing classical fraud methods more and more."
Tip of a dark iceberg
According to the Federal Criminal Police Office, economic crime causes the loss of an estimated 3.43 billion euros ($5 billion) in Germany every year. But accurate statistics are hard to establish, and the police estimates that up to 80 percent of economic crimes go undetected or unreported.
bk/KNA/APD
Editor: Michael Lawton